Correlation Between Ultrasmall-cap Profund and Fidelity Contrafund
Can any of the company-specific risk be diversified away by investing in both Ultrasmall-cap Profund and Fidelity Contrafund at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Ultrasmall-cap Profund and Fidelity Contrafund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ultrasmall Cap Profund Ultrasmall Cap and Fidelity Trafund Class, you can compare the effects of market volatilities on Ultrasmall-cap Profund and Fidelity Contrafund and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Ultrasmall-cap Profund with a short position of Fidelity Contrafund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultrasmall-cap Profund and Fidelity Contrafund.
Diversification Opportunities for Ultrasmall-cap Profund and Fidelity Contrafund
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ultrasmall-cap and FIDELITY is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Ultrasmall Cap Profund Ultrasm and Fidelity Trafund Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Trafund Class and Ultrasmall-cap Profund is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Ultrasmall Cap Profund Ultrasmall Cap are associated (or correlated) with Fidelity Contrafund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Trafund Class has no effect on the direction of Ultrasmall-cap Profund i.e., Ultrasmall-cap Profund and Fidelity Contrafund go up and down completely randomly.
Pair Corralation between Ultrasmall-cap Profund and Fidelity Contrafund
Assuming the 90 days horizon Ultrasmall Cap Profund Ultrasmall Cap is expected to generate 2.72 times more return on investment than Fidelity Contrafund. However, Ultrasmall-cap Profund is 2.72 times more volatile than Fidelity Trafund Class. It trades about 0.09 of its potential returns per unit of risk. Fidelity Trafund Class is currently generating about 0.09 per unit of risk. If you would invest 6,111 in Ultrasmall Cap Profund Ultrasmall Cap on September 3, 2024 and sell it today you would earn a total of 1,940 from holding Ultrasmall Cap Profund Ultrasmall Cap or generate 31.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ultrasmall Cap Profund Ultrasm vs. Fidelity Trafund Class
Performance |
| Timeline |
| Ultrasmall Cap Profund |
| Fidelity Trafund Class |
Ultrasmall-cap Profund and Fidelity Contrafund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ultrasmall-cap Profund and Fidelity Contrafund
The main advantage of trading using opposite Ultrasmall-cap Profund and Fidelity Contrafund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ultrasmall-cap Profund position performs unexpectedly, Fidelity Contrafund can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Fidelity Contrafund will offset losses from the drop in Fidelity Contrafund's long position.| Ultrasmall-cap Profund vs. Wt Mutual Fund | Ultrasmall-cap Profund vs. Matson Money Equity | Ultrasmall-cap Profund vs. Lord Abbett Emerging | Ultrasmall-cap Profund vs. Aig Government Money |
| Fidelity Contrafund vs. Boston Partners Small | Fidelity Contrafund vs. Heartland Value Plus | Fidelity Contrafund vs. Ultrasmall Cap Profund Ultrasmall Cap | Fidelity Contrafund vs. Columbia Small Cap |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |